"Mixer is just the most fascinating thing," Satya Nadella says. He's examining a large terminal situated in his office, where he stands before a real-time data visualisation hosted on Microsoft's streaming platform. "Somebody is broadcasting Japanese seismic activity and there are 25 people watching it," he laughs.

On entering, visitors must pass a bookcase that's well stocked with framed family photos. More books are neatly piled on a shelf on the other side of the room - Yuval Harari, Tracy Kidder, Michael Lewis and scholarly thinkers on business and leadership, as well as technology. Beneath is a signed, framed photo of Australian cricketer David Warner (the captain of Nadella's team, the Sunrisers Hyderabad) and, in pride of place, his most-prized possession - a bat signed by Sachin Tendulkar, the former Indian cricket titan and national obsession.

It's comfortable and convivial, a college professor's study. By CEO standards, it's modest. The contents reflect a couple of themes that emerge in Hit Refresh, Nadella's book, published in September, that's part leadership playbook, part management philosophy and part personal history. Firstly, he didn't grow up wanting to be an executive, but a cricketer, recalling in the book the trauma of attending his first test match in the 70s, which India lost to England by one innings. The aspiring off-spin bowler played until college, when cricket was displaced as his passion by computing. The seed of this conversion had been sown in the 80s, when Nadella's father returned from a trip to Bangkok with a Zilog Z80 computer kit for his then 15-year-old son.

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Secondly, Nadella comes across as a thinker as much as a doer. He references poets and philosophers. "Most of my reading is economics and society. Then there's AI and general business." Fittingly for the son of a Marxist economist, he recently read Wolfgang Streeck's How Will Capitalism End?, a series of essays on the collapse of the neoliberal order. "He says that capitalism is a strange system in that it expects two things: employees to be insecure, but [also] confident consumers," he chuckles. "That's what we're dependent on - it's not a stable system! 'Oh my God. I might not have a job tomorrow, but I've got to spend like a confident consumer.' [Streeck] is saying that's our problem, so you've got to create a solution."

A crow hops along the windowsill, and talk switches to Pakistan's thrashing of India in the ICC Champions Trophy in London in June. "I cannot believe it…" Nadella says of the Indian batting collapse, with a shake of his head and a rueful smile.

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ByAnna Codrea-Rado

These are not conversation topics usually associated with Microsoft's senior-leadership team. Nor is the language Nadella uses to describe how he has transformed the company's economics, perception and culture. In doing so, he wants Microsoft to change from producing products that people need, to producing products that consumers want.

If he can take the next step - convince consumers to love the company - it will be an accomplishment that ranks alongside the highest achievements of his predecessors. The process began with a question that he addressed to the corporation's 120,000 employees when he assumed the role in 2014: what would happen if Microsoft disappeared?

Satya Nadella in Hyderabad. He once dreamed of playing cricket professionally

BRIAN SMALE

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It's a balmy July day in the affluent suburb of Bellevue, which lies 15 kilometres east of Seattle, across Lake Washington. Mount Rainier pokes its head above the swaying conifers that adorn this part of the Pacific Northwest, the mountain a spectral, lunar presence to the south-east of the city.

The conversations with cabbies, bar staff and professional classes in this affluent, liveable city pivot around the inexorable, dramatic rise in house prices. The city's real-estate boom is being driven by the seemingly unstoppable rise of the Puget Sound area's tech companies. We have been here before, of course. In the mid-to-late 90s, the value of homes in the city increased dramatically. One constant in both these booms is the city's third-largest employer (and largest in the technology sector), Microsoft.

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To some degree, the 42-year-old company may be responsible for creating what we think of today as a large technology player - one that produces innovative, world-changing products which become integrated into our everyday lives in a way that we barely notice them, before assuming a dominant market position that eventually attracts the attention of regulators. It was the first to have its CEO on the nightly news, as Microsoft battled in US courts to maintain its supremacy in the PC market.

Nadella on...

Tech companies and regulation

"Sometimes people bracket us all as American tech companies. In reality, each one of us is different. It goes back to that sense of identity. The only tenable, long-term, stable strategy for a multinational company is going to be about the local opportunity that you create in every country you operate in. I don't believe there's a long-term strategy that says, 'I'm just going to be a rent collector in different places.' Because that doesn't work. Inside Microsoft, we have a business model wherein our technology is about empowering people so they can use that technology to create their own success. There lies the local opportunity. If you're operating in the UK, you've got to be UK first; in the United States, you've got to be United States first. The only way that will happen is by asking, 'Is there local employment being created in your channel? Are there local startups that are relying on your technology to create their own? Are small businesses becoming more productive? Is the public sector more efficient?' That's how I think of Microsoft's role."

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Microsoft may not have been the world's first household-name technology company - IBM takes that accolade - but it was the first to have a CEO whose name was synonymous with the company: Bill Gates. As co-founder of the company with Paul Allen, Gates personified Microsoft in all its wonky, groundbreaking, sharp-elbowed, market-pleasing dominance of the software industry throughout the 90s and early part of the 21st century. He was the software CEO who could develop and market products, as well as peering peevishly through his spectacles at Senate committees or testifying in court cases brought by the Department of Justice. He was the CEO who embodied the actuality that software had become the most valuable commodity in the world.

There have only ever been three Microsoft CEOs. Gates was succeeded by Steve Ballmer, a robust, high-energy marketer hired by Gates and Allen after he'd dropped out of Stanford Business School to be the company's first business manager. Ballmer took the reins in 2000 and oversaw a decline in the company's prestige and value as it came under pressure from new challengers, which were building technology businesses in areas where Microsoft was slow to adapt. When Ballmer was appointed, the company derived most of its revenue from its Office and Windows software. When he departed 13 years later, this was still the case, but the world had moved on: consumers had gone mobile and business wasn't server-driven in the way that it had been just a few years before.

Nadella green-lit the purchase of Minecraft, the second-biggest-selling game ever

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On January 24, 2014, Nadella, who was at the time running Microsoft's cloud-computing division, received an email from John Thompson, then the lead independent director at Microsoft, asking to talk. Nadella took the subsequent call on speakerphone late in the day, standing in his office holding a Kookaburra cricket ball. Nadella, then 46, was informed of his appointment as CEO.

Nadella is lean and talks rhythmically with clear points of emphasis, his sentences tilting upwards towards a crescendo. He often smiles when he talks, as if to reassure the listener of the veracity of his words. In conversation, he might quote Friedrich Nietzsche or Gautama Buddha, but he gets away with it because he presents himself as unpretentious, an enthusiast who can make small talk, as well as think big thoughts.

He had a peripatetic upbringing. His father worked for the Indian government and was transferred regularly. Nadella recalls being raised in "old colonial buildings in the middle of nowhere… in a country being transformed in the 60s and early 70s". When he was six, his younger sister died aged five months. His mother, a Sanskrit teacher, hung a poster of Lakshmi, the Indian goddess of contentment, in her son's room.

Nadella wasn't awarded a place at Indian Institutes of Technology, the subcontinent's powerhouse science and technology colleges, so he studied engineering at Manipal Institute of Technology in south-west India. After graduating, he applied to US colleges, assuming that a visa would elude him. To his surprise, he qualified and was accepted to study for a master's in computer science at the University of Wisconsin-Milwaukee. In August 1988, on his 21st birthday, he flew from New Delhi to Chicago. Midwestern winters were an unforgiving experience for a young man from southern India. After graduating in 1990, Nadella went to work for Sun Microsystems, then a giant computing system and hardware organisation that employed Eric Schmidt and Reed Hastings.

Nadella on...

Universal basic income

"It's clearly a good idea. But just having it doesn't solve the sense of purpose. In my case, for example, I have a couple of special-needs kids, so I see the amount that one can do in terms of people-on-people jobs, right? If you think about physical therapy or occupational therapy and so many things where empathy is key, in a world where there's AI in abundance, what's going to be scarce is real intelligence and empathy. Then maybe we as humans will have to become experts on that. Maybe it's not really about computer-science PhDs, but developing more human EQ [emotional intelligence] is probably going to be the most important thing we can have."

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One rainy day in November 1992, Nadella arrived at Building 22 in Redmond. Over the coming years, Microsoft would enter its pomp. He recalls being able to hear Ballmer down the hall in someone's office. "They were having this animated discussion - 'God, who is this guy?!'"

Nadella has been at Microsoft ever since and, despite being a long-time executive, has sought to bring essential change to a company that, under the trend-shy Ballmer, appeared to be in the early stages of a precipitous demise. What Nadella has done is not only bring Microsoft out of decline (at the time of writing its stock is at its highest-ever level - up 19 per cent in 2017 thus far), but to change the nature of the company internally and - miraculously - its image externally, to make it the kind of place that ambitious engineers and researchers might choose over its rivals. There is much to do: PC products still account for the majority of profits, and margins for cloud-based services are much thinner than those for software, but - whisper it - is Nadella building a company that finally has its swagger back?

"The greatest challenge is in managing the transition, from a world where Windows was at the centre and the business was built on software licensing, to a world of cloud, mobile and AI, where the model is moving away from licence towards subscription," says Brad Silverberg, a founding partner at VC firm Ignition Partners, who ran the Windows business and was part of Microsoft's executive committee. "It's incredibly disruptive and needs to be handled with skill. Go too fast and you destroy your business; go too slow and you become a dinosaur. Satya has done a fantastic job with this transition."

Scott Guthrie joined Microsoft in 1997. He runs the company's Cloud and Enterprise group and has changed the team's focus from revenue to user growth

Erik Madigan Heck

Outside building 34, where the Microsoft executive offices are located, a fresh breeze blows across the manicured Microsoft campus with its 84 structures, football pitches and communal cafeterias. Young people, mostly male, with lanyards around their necks, walk between buildings staring at devices. If there is ever a global shortage of cargo shorts, the Microsoft campus should be the first port of call for investigators looking for surplus.

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When he assumed the role of CEO, Nadella knew what he had to do was potentially incendiary: the job would involve shifting not just company strategy and business practices, it required a root-and-branch overhaul of culture. "We used to hang on to our past success too much and our industry doesn't care about past success," he says. "It's all about the future and every industry is like that nowadays. Being successful in the past means nothing."

He describes a time when the organisation would make decisions about products based solely on what its rivals were doing. Today's vision, he says, is to focus on developing products and services only if Microsoft has something unique to offer: "That sense of purpose has to inform the decisions on what we do."

Nadella on...

Leadership

"The larger the organisation, the more disciplined the leader needs to be in staying constant. One of the things that I get tempted to do from time to time is say, 'I have talked about this an infinite number of times. Let me make it more novel and sort-of just do something different.' And that is the worst mistake one could make."

"We pride ourselves on being an engineering-focused company," says Scott Guthrie, who runs the Cloud and Enterprise Group at Microsoft. "As we got more successful, you can get into the 'If we build it, they will come,' kind of mode and you can get a little bit more separated from customers as you get bigger." As part of the cultural shift within the division, Guthrie doesn't use revenue as a benchmark any longer, focusing instead on users - meaning growth - rather than takings.

According to a senior member of Microsoft management, at Nadella's first meeting with executive staff in early 2014, he focused on a discussion of company culture, rather than the organisation's ailing business. "It's not like I started with a blank sheet of paper," he says. "I actually had a well-formed view on that entire framework before I became CEO. It's not like that sense of purpose was not something I started thinking about the day I became CEO, but it was there subliminally in what I was thinking about it… One of the things that even Steve [Ballmer] told me is, 'Just be your own man'."

Changes occurred during the annual gathering of the company's top executives: traditionally a retreat involving only the most senior leaders, it was upended by invitations being extended to the founders of startups Microsoft had acquired over the previous year. Worse, invitations were extended to customers. There was pushback, but Nadella continued to advocate change.

"He's good at energy and enthusiasm," Guthrie says of Nadella. "He makes you feel like this is the most important thing happening in the entire world."

Silverberg shares similar views: "His style is mature, collaborative and supportive. Very partner-oriented. He leads by example, and companies are often defined by the character of the leader. Teams inside Microsoft today are more likely to have a shared vision and work collaboratively towards achieving company goals. He's sincere, caring and trustworthy. That spreads throughout the organisation."

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Another of Nadella's initiatives was to start meeting people that enterprise companies would usually disregard: customers who had gone with rivals. This sense of looking outside the organisation was also applied to the way Microsoft operated: today its products are available on other platforms and the company partners with competitors. Minecraft is available on the Xbox and PlayStation, despite Sony being Microsoft's main competition in the console market, and also on Nintendo, iOS and Android. Office runs on mobile devices that use its competitors' operating systems. Linux, for so long considered the enemy, is now supported on Microsoft's cloud platform Azure. The company is now end-to-end, or "full stack", from software through data centres to hardware. Office works on Android. Windows works on Facebook apps and Minecraft on Oculus. Nadella talks of partnering Microsoft's digital assistant Cortana with Amazon Echo. For years, Microsoft fought Google in courtrooms, but Nadella has sought to end the enmity.

Nadella on...

Automation

"There have been massive amounts of displacement with each technology revolution. The way we were able to overcome that, even if it was generational, was through new employment created in new sectors. So that's what I'm hopeful about. That said, it's fair to say if there's going to be true technological displacement and there are no jobs in any sector, whether it's blue collar or white collar, then what exactly are we going to do to ensure there are? Because then it's all about return on capital and there's no return on labour. I go back to the early Industrial Revolution in England, and the solution to it. There was a redistribution, which is a scary word, but at the same time, what somebody will have to entertain and say is, 'If there's return on capital and no return on labour, what will be the moral equivalent that creates it?' What is labour for? What are the jobs of the future? Jobs are not just economic - they also ground us in that sense of purpose. I believe that's another societal social challenge that can be solved."

"Whether it's with Sundar [Pinchai, Google's CEO], or whether it is with Bezos, Tim or anyone, this is a fundamental construct," he says. "We compete hard in many areas. But instead of viewing things as zero sum, let's view things as, 'Hey, what is it that we're trying to get done? What is it that they're trying to get done? Places where we can co-operate, let's co-operate.' And where we're competing, we compete."

Ed Anderson, an analyst at Gartner, worked for both Ballmer and Nadella during his six years at Microsoft's data centre and cloud business. "With Steve Ballmer, it was much more of a 'Show up with the facts, we'll review them, challenge you on them and see how much work you've done to make sure they're right,'" he says. "With Satya, it was very different. Regardless of who was in the room, whether it was a senior VP or product manager, he would listen intently to what people had to say. I was struck that every opinion is important to him, every perspective is important. I get the sense that he feels that everyone at Microsoft has a contribution to make. And that was a stark difference for me. I think he really values multiple perspectives. You'll see this in the way that he interacts with partners or customers. He's genuinely interested in what they have to say."

Nadella believes that Microsoft HoloLens will usher in an era of "mixed reality"

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In discussion, Nadella's sense of the cultural shift to openness and partnerships can sometimes hit an existential note. His approach isn't "as much about any particular strategy or anything, it's a meta framework for how one pursues this constant process of renewal". He stresses the continual nature of this progress. "Our consumer business was conceived in the 80s and 90s," he says. "When I look at, say, [today's] channels of reaching customers… you don't go through the traditional channels. A company can only stay relevant if it's able to confront those realities and continuously change. Technologies will come and go, but the sense of purpose will give us at least the direction, and how we express our identity."

He's aware of the challenges of change within a large organisation and admits to being unsure how the 120,000 Microsoft employees across the world would respond. "In the past, whenever we've tried to have these cultural values, put up posters and what have you, I wasn't able to recall what the heck they meant or what they were, they were all corporate speak," he explains. "I think a lot of us love to talk about culture, but it has got to take organic root. It's the hardest process - and there is no formula."

When Nadella took the role, Microsoft's circumstances were a classic example of the innovator's dilemma: he needed to persuade senior executives within Microsoft and on the board that the organisation must stop focusing on the products that were delivering the majority of revenue and profits in favour of new endeavours with little tangible benefit.

Nadella had an advantage, in that he'd been through a similar process internally. Under Ballmer, he'd been in charge of the Server and Tools Group. In the client-server era, it had been a huge contributor to the bottom line as the third-largest in group revenue, after Office and Windows. Nadella realised that the architecture Microsoft was using to build products such as Xbox Live, Bing or MSN were no longer reliant on what it was selling to enterprise customers. They were essentially building cloud infrastructure for their online properties.

Nadella had to convince the team to shift focus from the server business, which he describes as "the biggest transformation of Microsoft in a generation". He did so without bringing anyone from his team at Bing. "It was important that the transformation comes from within," he writes.

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Early in Hit Refresh, Nadella writes about the birth of his son, Zain. One night in August 1996, Nadella's wife Anu, then a nascent architect, noticed that the baby she was carrying wasn't moving in the way that she had become used to. The couple waited at A&E in Bellevue before she was examined by doctors, who ordered an emergency caesarian. At 11.29pm the child was delivered. He weighed three pounds and made no noise. The following morning, Nadella went to visit first son, Zain, at the Seattle Children's Hospital, where he had been transferred to a specialist unit. "Little did I know then how profoundly our lives would change," he writes.

Eventually, the couple learned that Zain had undergone perinatal asphyxiation and was suffering from severe cerebral palsy, meaning that he would have to use a wheelchair and require life-long care. The way Nadella tells it, his initial reaction was to think subjectively about what had happened.

"I was born a single child of middle-class parents from India; so was my wife. Both of us were here," he says. "Then our first son was born when we were 29, and I would say it took us multiple years to accept what had happened.

"That process, and seeing all the people around Zain, completely changed a lot of how we have viewed the world and recognising, even within our relationship to our own son, that the first few years was more about, 'Oh, what happened to me?' And then I woke up finally to the fact that nothing happened to me, it happened to my son. And that ability to get that, itself, was probably one of the bigger mental breakthroughs.

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"There's this lady who goes to Buddha and says, 'Hey, my son died, can you bring him back to life?' And he says, 'Go find one family where there has been no death and come back with a grain of rice from that family and your son will be reborn.' The reality is that all of us have something or other where there is a way for us to develop empathy. It is just that we have got to tap into it."

Nadella on...

Artificial intelligence

"The first Microsoft product was the BASIC interpreter that Bill Gates and Paul Allen wrote for the Altair. It was all about building tools that allowed hobbyists to write computer programs for new computers. And that's at the core of who we are. We're tools makers. We know how to make it possible for people to write apps for emerging platforms. So how do I bring that mindset to machine learning and AI? Our job is to democratise it so every company can be an AI company. AI is all part of the stack. It is infrastructure - you should have whatever GPU compute you want, so you can build your own intelligence. It's a set of APIs. If you want speech recognition, you want image recognition and text understanding. It's about applications with built-in AI. Every part of what we do will be AI. But, more importantly, every company that works to build something of their own will incorporate AI. That's what I mean by democratising AI. AI is perhaps the most transformative thing that's ever happened."

Nadella, who also has two daughters, argues that this experience is at the core of his vision for Microsoft. "My passion is to put empathy at the centre of everything I pursue - from the products we launch, to the new markets we enter, to the employees, customers and partners." Within the first 11 pages of the book, Nadella has set out his stall: Microsoft - and its employees - must have a higher calling. Each individual must pursue personal passions to empower others.

But there are harder-edged realities to running the company with the third-largest market capitalisation in the US. The day before we meet, Microsoft announced that there would be thousands of job losses - some reports suggested 3,000 - mainly for salespeople. Nadella talks of the importance of being able "to do the right thing by them, and do the right thing for the company to change". Then there is the balancing act of ensuring that short-term quarterly earnings reports are balanced with long-term planning in a highly competitive sector, which is moving rapidly to build tools that the rest of the world relies on for its own businesses.

Nadella has written about betting the company on AI. Two recent initiatives suggest that Microsoft is competing aggressively with Google's DeepMind and others in the space, such as the nonprofit OpenAI. In July, the company announced that it was opening Microsoft Research AI in Redmond, to work on areas such as natural-language processing, reasoning and perception - a clear move towards the development of a general-purpose AI rather than a narrow version that can perform a single task.

The same month, Harry Shum, who heads up Microsoft's Artificial Intelligence and Research Group, announced a deep-learning processor for HoloLens, which will run the software behind speech and image recognition for the mixed-reality platform. The announcement came just a couple of months after Google announced a cloud service that will provide access to a proprietary AI chip that is designed to train and execute deep neural networks.

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Nadella's belief is that, for Microsoft to become an enduring company, it will need to find success in cloud, quantum, sensors, mixed reality and AI. He is making big bets on this. The company is investing heavily in being the first to bring quantum technology to market, with a timeline of three to five years. There is talk of possible initial use-cases in applications for chemistry and biology, although there is still some debate as to what the business model will be.

"You need to have high ambition and a long-term approach to R&D, right?" Nadella explains. "As I said, we got started on what is mixed reality with Kinect, and it's taken us decades. It's a similar approach that we are going to take with quantum. There are breakthroughs in maths to physics to computing that all have to come together to make a quantum computer really real."

Microsoft is distinguishing HoloLens by the fact that it is mixed reality. It can be virtual (fully immersive) or augmented (with digital images layered on top). "We've got started on this journey of essentially thinking of the field of view as a new natural interface," Nadella says, citing use-cases in medicine, logistics, retail and gaming. (Minecraft, which was purchased by Microsoft in 2014, is the second biggest-selling game of all time.)

The products that technology companies generate are having a profound effect on individuals, civil society, governments, institutions and the law. Between them, the world's most powerful technology companies are compiling vast amounts of data about individuals at a dizzying speed. Nadella acknowledges that consumers should have rights over their own data and that there should be a value exchange when tech companies use private information. "There should be transparency around why we're collecting that data. There should be control with the user in terms of what data is being collected and not collected."

Nadella on...

AI and ethics

"We are in some sense quite a way from artificial general intelligence. But we are on the ladder towards it. So what should be the ethics of AI? Let's leave it to the moral philosophers to write about that. But we should take more ownership. What are the guidelines and the responsibility we should have? Just like we have, for example, guidelines for good user experience. How accessibility, for example, has to be built in, and universal design should be something that we build in. What's the moral equivalent? It's a design choice, which is that we can either choose to build AI that augments human capability versus going first and foremost to saying, 'Well, let's replace it. 'Also, who takes accountability? Even if it's a black box, the reality is that black box has a lot of metadata around it and choices that inform it. We have an ethics committee led by Eric Horvitz. More importantly, I think that regulation will catch up with this technology, and I think there will be a broader dialogue about AI and the displacement it causes."

Privacy also came to the fore in February 2016, when a federal judge asked Apple to unlock an iPhone belonging to Syed Rizwan Farook, the shooter responsible for 14 deaths during the San Bernardino shootings in December 2015. Tim Cook described the court order as "chilling" and the company refused to comply.

"We were very clear that any notions of back doors and so on are bad ideas," says Nadella, who supported Cook's decision. "But, at the same time, we have always said that there is a responsibility for the state to protect its citizens. And, therefore, there should be a mechanism that is legislated and a law of how the government goes about that process. It cannot be left to the CEOs of tech companies arbitrating the policies for the world. It's a strange position to put four or five of us in, to decide for the world what should be the equilibrium. Nobody elected us. If we believe in democracy, the legislatures should take back control of what is the rules of the land."

Nadella at an American Technology Council meeting in June 2017 with (l-r) Tim Cook, Donald Trump and Jeff Bezos

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Recent attempts by President Trump to harden the US border to immigrants have not been received well by startups or large technology companies alike. Nadella tactfully positions the issue as one associated with economic growth: talent, ideas and new technologies are key for innovation. As an immigrant (and one who gave up his green card to ease his wife's passage into the US), he has an uncommon perspective for a CEO.

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"I'm a product of two uniquely American things," he says, "which is American technology reaching me where I was growing up and giving me the opportunity to dream the dream of coming here. And then the immigration policy allowing me to stay and live that dream. I think of those two opportunities I was given as something America should always stand for."

Soon after he took over as Microsoft's CEO, Nadella had a meeting with Ballmer. He asked his predecessor if he had any plans to write a book about his time in charge of the company. Ballmer admitted that he had thought about it, but writing about the past didn't seem too appealing a prospect. He was more excited about his May 2014 purchase of the LA Clippers basketball team and other fresh projects he had in the pipeline. Ballmer's words stayed with Nadella and, when he was writing his own book, he realised that the end product would be the "meditations of somebody who was sitting in the seat and going through the process". He pauses briefly… "And knowing that you are not done, by any means."

Greg Williams is the editor of WIRED. He wrote about the rise of algorithmic trading in 04.17. This article is published in the 11.17 issue of WIRED magazine, on newsstands from October 5.

This article was first published in the November 2017 issue of WIRED magazine